Room for improvement in Colorado marijuana inspections, audit shows

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Colorado’s marijuana regulator could improve its operations in several areas, including retail cannabis store inspections and enforcing rule violations, according to a recent report from the Office of the State Auditor.

The state’s Marijuana Enforcement Division (MED) failed to inspect 36% of newly licensed cannabis retailers within a year of their permit approvals between fiscal years 2019 and 2022, according to the “2023 Performance Audit,” dated July 25.

The report said the MED also:

  • Failed to “conduct targeted inspections on some businesses that met risk factors.”
  • Did not conduct underage compliance checks on a minority of stores marked for such checks.
  • “Did not consistently cite retail marijuana stores for all violations associated with marijuana sales to underage individuals.”

The watchdog’s sample included 44 violations of marijuana law and rule violations by stores but found that the MED didn’t pursue disciplinary action in 23 of those cases.

Finally, the auditor identified issues regarding MED documentation surrounding its 2018 sole source contract with seed-to-sale tracking system Metrc, saying that the agency’s “purchasing process did not ensure that a sole source procurement was justified.”

The MED agreed with several recommendations made by the auditor and will make changes by July 2024.

Mark Ferrandino – who led the MED’s parent agency, the state Department of Revenue, when the audit was conducted – told legislators that Colorado is “held up as a gold standard in terms of the way we do this work,” the Colorado Politics news outlet reported.

“That does not mean there’s not room for improvement.”

Ferrandino said MED’s current compliance rate is roughly 99%.